A recent National Labor Relations Board ruling may force employers of all sizes to rewrite their employee policy handbooks to meet a new legal standard on the rights of workers to unionize, according to employment lawyers.
The ruling in August adopted a new legal standard that shifts the burden onto employers in determining if a company’s rules infringe on Section 7 of the National Labor Relations Act, which protects employee actions that involve or could lead to unionization.
Under the new standard, a company’s employment policy can be deemed “presumptively unlawful” if it is proved that the rule has a “reasonable tendency to chill” employees from exercising their Section 7 rights.
A policy could be challenged if it could hypothetically be interpreted as being coercive, even if there is also reasonable non-coercive interpretation, lawyers say. The NLRB specified that it would assess workplace policies from the perspective of an employee who is “economically dependent” on their employer and “contemplates engaging in protected concerted activity.”
Employers can counter a challenged rule by proving it advances legitimate business interests and that there is no way they could have drafted the policy more narrowly, according to the labor attorneys.
But Alicia J. Samolis, chair of labor and employment practice at Partridge Snow & Hahn LLP in Providence, said the ruling sets a “frightening standard” for companies, as it will be difficult to prove there is no better way they could have written a challenged rule.
The NLRB decision stems from a 2014 case in which the Teamsters Local 628 challenged the workplace rules of Illinois-based medical waste disposal company Stericycle Inc. in California, saying it limited the employees’ collective bargaining rights.
The ruling issued on Aug. 2 continues a pattern of the NLRB – depending on who is appointed to the board – going back and forth in siding with employees and employers in adopting standards in evaluating the legality of workplace policies, said Timothy C. Cavazza, labor and employment attorney and partner at Providence-based Whelan Corrente & Flanders LLP.
A 2017 ruling on employment policies involving Boeing Co., and another decision two years later, was considered more friendly to employers, but the Stericycle decision leans further in favor of employees than earlier decisions, Cavazza says, in part because it lowers the initial burden to challenge company policies while also making it more difficult for employers to defend them.
Labor leaders see the NLRB ruling as a victory.
The decision is an important step for employees’ ability to freely exercise their rights and be critical of their employers, says Patrick Crowley, secretary and treasurer of the Rhode Island AFL-CIO.
Crowley says the new standard particularly benefits employees who are not part of a union because the burden of proof falls on employers who are likely to have access to more resources than someone who is not part of a bargaining unit.
Indeed, Marc Gursky, an employment and workers’ compensation attorney at Gursky Wiens & Shanley Attorneys at Law Ltd. in Warwick, says the reasoning behind the decision is that employees may have felt discouraged from advocating for themselves.
“Employees are often concerned that they’re going to be retaliated against if they speak up for themselves or each other about working issues,” Gursky said. “The more that they understand that that type of retaliation is illegal, the more likely they’re willing to stand up for themselves [or] their co-workers.”
Meanwhile, Samolis says, this decision could be costly for small businesses that may not have a budget for a lawyer or time to review each of their workplace policies.
The new standard also applies retroactively to pending cases, which makes it even more complicated for employers to edit and develop workplace rules. This is because employers will have difficulty predicting how their rules will be analyzed as the board shifts its standards, Cavazza says.
Employment lawyers say most businesses should now review their policy handbooks and speak with their attorneys. More specifically, employers should ensure all their policies still make sense for their business and are up to date. Companies will also need to include specific language such as disclaimers within their individual policies.
“It puts employers in a difficult position,” Samolis said. “They’re going to have to make decisions of if a policy is worth it at all, and if it is, then they’ll need a lawyer to craft explicit carve-outs informing employees of their rights.”
But disclaimers might not even be enough under this new standard.
“This current board is going to find most employer rules unlawful,” Cavazza said.
